Winter Newsletter 2007

More Trouble for Morgan Stanley?

Alabama Securities Commissioner Joe Borg said recently that investment bank Morgan Stanley might have some questions to answer from state securities chiefs over withheld e-mails from an earlier federal investigation.

New York-based Morgan Stanley last year agreed to pay U.S. regulators $15 million to settle allegations it withheld e-mails during a probe into biased investment research. Borg, who is also president of the North American Securities Administrators Association, said Morgan Stanley might need to reach a similar settlement with the states.

"We are talking about e-mails that were withheld, destroyed, or written over," Borg said. "We are turning our attention to this and have been talking to Morgan Stanley for a couple of months."

Morgan Stanley was part of a global settlement involving 10 Wall Street firms that agreed to pay $1.4 billion to settle accusations that they misled investors to win investment banking fees.

Excerpt from the Birmingham News